AMAZON ALREADY MOVED IN, WITHOUT HEADQUARTERS
HQ2 or not, Amazon is already in Colorado — and rapidly expanding
Forget HQ2. Amazon is already in Denver and rapidly expanding. And it’s relying on few public funds to do so, at least compared with what the state is offering for the big prize.
A growing number of Amazon tech employees work in Broomfield and Denver, and those offices still have 33 openings. On another career page, Amazon has about 80 full-time openings in Colorado, including hiring for “a new team” in Boulder to focus on digital advertising, consumer electronics software engineers and tech workers with security clearance to help U.S. Department of Defense organizations roll out cloud computing. The Seattle behemoth is also expanding nontech jobs — it needs a manager for its first brick-andmortar bookstore in the state at a mall in Lone Tree; it needs more Prime Now associates for new locations in Lakewood, Broomfield and the Denver Tech Center; and there are its two distribution centers operating in Aurora, with a third one opening this fall in Thornton.
“Amazon is excited to be growing in Colorado and already has more than 1,500 full-time employees across the state in corporate offices, Fresh, Prime Now and fulfillment center locations,” Lauren Lynch, an Amazon spokeswoman, said in an email.
This, of course, has nothing to do with HQ2, Amazon’s search for a second headquarters that has the nation in a frenzy about where the company will plunk down a $5 billion investment and hire 50,000 workers. For anyone not paying attention, Denver is one of 20 finalists left in the continental competition. Amazon, which had asked for proposals to include potential incentives, plans to make a decision this year.
There is concern that the state is willing to offer too many incentives — state officials said it could exceed $100 mil-
lion in tax credits — to lure Amazon. And businesses that work with the giant online retailer have mixed feelings about it possibly employing so many people here. Many would welcome more faceto-face conversations with Amazon employees. Others bemoan the potential impact Amazon’s huge presence would have on housing and traffic.
“The vast majority of our interaction is remote or over the phone, but we find that we can gain traction and pursue opportunities just quicker when you have that face-to-face and the opportunity to go to lunch,” said Bill Santos, the president of Stelligent Systems, a division of Denverbased Hosting.com, which relies on Amazon Web Services. “Relationships build quicker.”
But longtime tech executive Luke Norris, the CEO of internet cloud service Faction, worries about an issue many locals face: competing for the same talent.
“I definitely think it’s a mixed bag is the best way to put it,” said Norris, whose company just raised $18 million in venture funding to expand its Amazon Web Services offering. “The negative is that a behemoth like Amazon in our backyard will make it harder to find the talent and resources. It’s already a challenge in the very healthy market we have in Colorado. I think we have close to 30 openings.”
So far, the state has offered Amazon not a penny in financial incentives for its current expansion here, according to the Colorado Office of Economic Development and International Trade. Aurora, which nabbed the first Amazon facility in 2016, put up $1.18 million in tax rebates to lure the company’s first distribution center. But for the most part, public incentives have been focused on new roads, new power systems and other infrastructure to benefit the local community.
“I think it’s terrific if they expand here in Colorado. I just don’t think we should give them one red cent,” says Republican gubernatorial candidate Victor Mitchell, who is running ads welcoming Amazon to the state as long as incentives are withheld. “They’re the richest company in the world. (Financial incentives don’t) mean anything to anyone over there. We need to earmark our economic incentives for rural communities.”
Regardless of whether or not Amazon plunks down its HQ2 here, Thornton is moving ahead with $100 million in infrastructure improvements that include widening Washington Street to six lanes, improving drainage, extending a sewer line and adding capacity near the future Amazon robotics distribution center, which opens in the fall.
“Prior to Amazon, the city had invested over $50 million in infrastructure in the N. I-25 corridor and in addition to the improvements Amazon is doing for their site, we are planning to invest an additional $50+ million in infrastructure in the area,” Adam Krue- ger, Thornton’s assistant director of economic development, said in an email. “The city did not provide incentives to Amazon, however Amazon is able to take advantage of some of the previously constructed and future planned infrastructure improvements.”
Krueger credits Amazon’s presence for four developers currently looking at the Central Thornton Business Park with “some of it being planned to be built on spec,” he said. “We also have some sites coming on the market for employment uses that have previously not been marketed. This is exciting and should boost our efforts to bring more employers to Thornton.”
Aurora, too, has found that “development begets development,” said Yuriy Gorlov, the vice president of the Aurora Economic Development Council. But he credits the developers of the two sites where Amazon moved its warehouses for investing in their own infrastructure.
The city began talking to Amazon in January 2016, and in five months, the company opened a sorting center.
A year later, it opened its first distribution center in the state at the industrial Prologis Park 70. Walmart, too, acquired 169 acres at a nearby development on Jackson Gap Street south of Denver International Airport. But the city didn’t hand Amazon a blank check, he said.
“Amazon wouldn’t have chosen Prologis if the developer hadn’t put in new streets, new power and talked to Xcel. It’s the same with the Walmart deal. That wouldn’t have happened, but the developer was putting its own money into Jackson Gap,” he said.
The rebates that Aurora offered for Amazon’s distribution center are paid out only if the company hires 900 full-time employees over 10 years. The investment is already paying off because the jobs are closer to city residents and the city is collecting additional sales tax, said Wendy Mitchell, Aurora EDC’S president and CEO.
“For us, we have to be creative. Maybe it’s more important to assure the company they’ll be up and running in 30 days, or to figure out where all their employees can live,” she said. “Frankly, in Colorado, we have to do that. In Texas and other states, they’ll just write big checks, but as you can see, we’ve been very successful.”
The Colorado Department of Transportation also has several projects in the works, regardless of Amazon. That includes expanding Interstate 70 lanes and improving Interstate 25 through Denver’s core. CDOT also is working with the driverless-car industry and alternative transport makers, such as Arrivo’s highspeed hyperloop.
“In light of the growth that’s already happening, 50,000 people in the metro area is a drop in the bucket. The state is already facing 50 percent growth (by 2050) in Colorado anyway, and the majority of that will be in the Front Range,” said Amy Ford, a CDOT spokeswoman. “We have all of those (growth projections) on the books, if you will. Amazon is planning to be part of all of that.”
In other words, Amazon already knows what’s coming to Colorado and will make up its mind on its HQ2 accordingly. Meantime, it is choosing to expand here, and some locals are grateful.
“They’re not here yet,” said Troy Lerner, the CEO of Booyah Advertising in Denver. “But it’s a really good sign. It’s a sign that technology and advertising is becoming a nexus in the Denver and Boulder area. It further emphasizes it as an important industry in our town. And a face-to-face meeting is always better, so I hope they’ll be in our backyard.”
Tamara Chuang: tchuang@denverpost.com or visit dpo.st/tamara